This depends on how the broker is being paid. The answer ultimately is yes, but it depends on how the broker’s being paid and which form you’re talking about. If the consumer is paying the broker directly, then the broker comp is shown both in the Loan Estimate and the Closing Disclosure as an origination charge. That’s specifically mentioned in the rules to origination charges, which are section 1026.37(f)(1). If what you’re talking about is creditor-paid broker compensation—like you have in points and fees today for creditor-paid LO compensation—that will not go on the Loan Estimate. Consumer testing showed that it was confusing and consumers thought this was a charge they were going to be paying, so it was not actually included on the Loan Estimate. However, it is still on the Closing Disclosure as a paid by others charge. There is a regulatory provision there (38(f), if I’m not mistaken), which tells you where to put it on the Closing Disclosure. Essentially, this number should be exactly what you’re including in points and fees for creditor-paid compensation and it goes only on the Closing Disclosure. Consumer-paid goes on both and it’s an origination charge.
Answered By: Andy Arculin